Phuket Hotel Market Update August 2021

C9 HOTELWORKS

Phuket

Hotel Market Update

Mid-Year Edition August 202 l

Room night demand shifts upwards with the Phuket Sandbox model

Nearly two-thirds of island's

new hotel projects delayed

"International visitors are an important foundation in driving tourism growth in Phuket. According to the Airports of Thailand, international passenger arrivals increased for ten consecutive years to reach a record of 5 3 million in 2019 before decreasing by 80% to l . l million in 2020 due to travel restrictions under the COVID-19 pandemic While this year total passenger arrivals between January to July

dropped to O 4 million from l 9 million passengers in

2020.

In FY2020 , the market-wide ADR was propped up by the government's 'We Travel Together' program However, the Bangkok travel restrictions have effectively negated the domestic market and made the island reliant on Sandbox travelers This has pushed market-wide demand into double digits, though rates have dropped

Phuket became the first province in Thailand to welcome back international visitors without quarantine requirements. Based on the Tourism Authorily of Thailand (TAT), the

reopening of Phuket quadrupled its room night demand in

July, with further gains registered in August.

Airport Passenger Arrivals

No. of Passengers (M)

100

0 80

0.60

0.40 0 20

. 1. 1_1_1 _

0 00

?

Jan Feb Mar Apr May Jun Jul

2019 2020 202 l

Source: Airports of Thailand

Due to the ongoing pandemic, 67% of pipeline project projects have been delayed , mostly to 2023-24 The West Coast remains the most popular development area , led by Kamala, Patong, and Layan Despite the ongoing COVID-19 impact on hotel owners , only two significant transactions of hotels occurred this year, though more are expected over the new 12-18 months."

Bill Barnett, Managing Director, C9 Hotelworks

? Total airport passenger arrivals hit a high of 9 l 2 million in 2018, then for 2019 slightly decreased to 9 06 million (y-o-y -l %), and dropped to 2 5 million in 2020 (-7 l %)

? Under the Phuket Sand box program in July, the number of International passenger arrivals was 14,055 with 190,843 booked hotel room nights

? Island's hotel pipeline has 20% of projects on schedule, with 67% delayed and 13% have been cancelled .

? Phuket Airport's expansion remains in progress and will be completed by 2025 The upgrade will lift up the stated passenger capacily from 12.5 to l 8.5 million .

? Of the 5,838 keys in the hotel pipeline, 78% are positioned in the upper-midscale, upscale, and upperupscale segments.

? By the end of 202 l , total registered hotel supply for the island is forecasted at 92,459 hotel keys in 1,785 establishments.

TOURISM MARKET REVIEW

Tourism Indicators

Flight Arrivals - Phuket International Airport - 201 8 through Jul 2021

Fli ghts

%

35,000 30,000 25,000 20,000 15,000 10,000

5,000 0

~ - - - - - - - - - - - - - - - - - - , - 20

0

- - - - - - - - - - - - , -20 -40 t - - - - - - - - - - - - - - - 1

2018

2019

2020

-60

~ -~ -------.J.. -80 Jul 2020 Jul 2021

- Domestic - International

Totol Growth

Airport Passenger Arrivals - 2019 vs . 2020

Flight Arrivals (Ian - lull 202 l: 4,298 2020: 13,347

Source: Airports of Thailand

20 19 (Pre-COVID)

2020 (COVID)

902,351 c::=====m=------- 926,364

c::=====1~=- - - - - 872,559

587,734

c::====:t:li ,Ci - - 853 ,021

282 ,075

775,654 - - - - -- - 1,650 592,714 .___ _ _ _ 0

631,481 ...__ _ _.;;U'-'-'--1 14,234

720,892

70,206

732,623

u - 95 ,834

594,633

e - 121,530

717,629

- 154,738

772,365

o - 160,795

943 ,559

- 172,071

Tourism Revenue

0

M

Passenger Arrivals 2019 (Pre-COVID): 9,066,366

2020 (COVID): 2,587,231

Source: Airports of Thailand

THB (M)

300,000 250,000 200,000 150,000 l 00,000

50,000 0

Jon -Jul 2019

Jon -Jul 2020

Jon -Jul 202 l

Tourism Revenue (Ian - lull 202 l : THB6,592 million

2020: THB l 00,995 million

22 C9 Phuket Hotel Market Review: August 202 l

Source: Thailand Ministry of Tourism and Sports

HOTEL MARKET REVIEW

Hotel Performance - 2019 vs . 2020

Average Daily Rate

TH B 6,000

4,000

2,000

0

2019

G rowth

%

8

100

6

75

4

50

2

25

0

0

2020

- ADR - -Growth

Occupancy

2019

2020

- Occupancy - - Growth

G rowth

10 -10

-30 -50

Source: STR and C9 Hotelworks Market Research *Data as of FY2020

Room Night Demand by Month - Jan 2019 through Jun 2021 %

100

80

60

40

20

0 FMAM

ASONDJ FMAMJ

A SON DJ FMAM

2019

2020

2021

Source: Thailand Ministry of Tourism and Sports *Phuket Airport closed from April l 0th through June 12th

Hotel Pipeline Insight

Project Status

By Type

Branded vs . Non-branded

~ 20%

?67%

On-time Delayed Cancelled

Hotels Hotel Res idences

23 C9 Phuket Hotel Market Review: August 202 l

Branded Non-branded

Source: C9 Hotelworks Market Research

Hotel Pipeline

Hotels Melia Phuket Mai Khao GLOW Mira Karon Beach Courtyard by Marriott Phuket Town* Noku Phuket Holiday Inn Phuket Kata Beach Holiday Inn Express and Suites Kata Beach Angsana Oceanview** MGallery Hotel MontAzure Lakeside Phuket Movenpick Phuket Kamala Beach Ibis Styles Phuket Kamala Zenkiri Holiday Inn Vona Nava Phuket Tribe Phuket Patong Avista Novotel Phuket Naiharn Melia Phuket Karon Radisson Hotel Mai Khoo Tonino Lamborghini Boutique Hotel Phuket

The Beach Plaza Phase 1

JW Marriott Phuket Resort & Spa Chalong Bay Courtyard by Marriott at Chalong Bay W Phuket Nai Harn Beach Centro Central Phuket COSI Central Phuket Centro by Centara Maikhao Resort Phuket Holiday Inn Express Phuket Kata Sheraton Phuket Grand Bay Resort Total Hotel Residences with Mandatory Rental Program Platinum Bay Phuket Oceana Surin - Hotel Zone

Patong Bay Hill 2

Patong Bay Seaview Residence Angsana Oceanview Residences** Dhawa Phuket Residences Best Western Premier Himalai Resort Ramada Plaza Grand Himalai Resort Patong Bay Oceanview Cottages

Patong Bay Residence Phase 3

Total Hotel Residences with Optional Rental Program Loya Condominium and Resort - Phase I The Marin Phuket Oceana Surin - Residential Zone Utopia Thalang Utopia Mai Khoo Utopia Central Utopia Karon Utopia Yamu Beachfront Bliss Naiyang Utopia Dream VIP Galaxy Villas Rawai The Residences at Sheraton Phuket Grand Bay Total

24 C9 Phuket Hotel Market Review: August 202 l

Location Mai Khoo Karon Phuket Town Chalong Bay Kata Kata Bangtao Kamala Kamala Kamala Kathu Patong Nai Harn Karon Mai Khoo Ao Por Kata Chalong Bay Chalong Bay Nai Harn Kathu Kathu Mai Khoo Kata Ao Por

Location Kamala Surin Patong Patong Bangtao Bangtao Kamala Kamala Patong Patong

Location Layan Kamala Surin Thalang Mai Khoo Kathu Karon Yamu Nai Yang Nai Harn Rawai Ao Por

Keys

100 154 248 91 140 135 116 236 230 300 255 230 650 224 222 51 730 189 277 60 170 180 280 300 270 5,838

Keys

432 333 199 454 33 175 427 426 300 114 2,893

Keys

926 260 555 129 92 405 238 81 96 633 114 101 3,630

Opening Year

Oct 2021 Oct 2021 Q3 2021 Ql 2022 Q4 2022 Q4 2022 2023 2023 2023 2023 2023 2023 2023 2023 2023 2023 2024 2024 2024 2024 2024 2024 2024 2025

TBA

Opening Year

Ql 2022 Q3 2022 Q4 2022 Q4 2022 2023 2023 2023 2023 2023 2023

Opening Year

Ql 2022 Q2 2022 Q3 2022 Q4 2022 Q4 2022 Q4 2022 Q4 2022 Q4 2022 2023 2024 2024

TBA

* Additional Keys for Existing Hotel **Additional Keys for Existing Hotel with Residences Source: C9 Hotelworks Market Research

BILL BARNETT

MANAGING DIRECTOR

C9 Hotelworks is on internationally recognized consulting firm with extensive experience in the Asia Pacific region. Its core business focus includes:

? Hotel and Resort Development ? Asset Management / Ownership Representation ? Project Feasibility and Ana lys is

Key competencies include international hotel operator search , selection and contract negotiation, mixed use hotel and residen tial planning and operation reviews .

A w ide range of both institutional and private developers and a comprehensive portfolio of

completed projects give C9 the ski ll set and background to focus on key issues, evaluate complex ones and assist clients in achieving sol id results. Based in Phuket, Thailand and led by Managing Director Bill

Barnett, who has 30 years of experience in Asia

Pacific, the firm is we ll positioned to serve an increa sing demanding marketplace.

C9 Hotelworks Company Limited 9 lagoon Road, Tambon Cherngtalay, Thalang Phuket 83 l l O Thailand T +66 (0)76 325 345/6 E info@c9hotelworks com

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